Air Canada plots own rewards plan
The airline says it will not renew contract with Aeroplan provider Aimia
Air Canada said Thursday it will launch its own loyalty rewards plan in 2020 and will not renew its contract with the company running Aeroplan, sending Aimia Inc.’s stock plummeting by more than 50 per cent, angering some points collectors.
The Montreal-based airline says customers will be able to continue collecting Aeroplan points until June 2020, after which miles earned from flying on Air Canada or its 26 Star Alliance partners will be credited to the in-house loyalty program instead. Travellers will be able to redeem those points for Air Canada and Star Alliance flights.
The airline said it intends to continue allowing Aeroplan members to redeem their Aeroplan points for seats on their flights after June 2020. However, Aimia’s CEO said that isn’t certain yet, as there are still a lot of discussions to be had.
Some Aeroplan members didn’t react kindly to the development on social media.
Some were annoyed their Aeroplan points wouldn’t be carried over to the airline’s in-house program in 2020. Others worried they wouldn’t be able to use Aeroplan points for Air Canada and Star Alliance flights beyond June 2020 and were concerned they’d have to rush to redeem points before it was too late.
This isn’t the only time in recent history Canadians have felt shortshifted by a loyalty program. LoyaltyOne, the company that operates Air Miles, upset consumers when it announced it would change its policy so collectors would lose any miles they don’t use within five years.
The policy, which was to take effect Dec. 31, 2016, was cancelled following a consumer backlash.
Aimia CEO David Johnston said in an interview the company is exploring alternatives for its business after Air Canada’s contract ends, including pursuing other partners.
“This is something we’ve anticipated,” Johnston said in an interview on his first day on the job after serving several months on an interim basis. The company announced Wednesday evening that Rupert Duchesne, who has been on medical leave, is retiring from the top role.
He assured the program’s five million customers they can expect a smooth transition.
“There’s three years left to run on the contract and in that period, it’s business as usual,” Johnston said.
Even so, Aimia shares fell 57 per cent to $3.80. Air Canada’s stock rose 8.5 per cent to $16.16.
Air Canada said it’s aiming to strengthen its customer relationships with the switch. It declined to comment further on the change.
Aeroplan was originally Air Canada’s in-house loyalty program. It was spun off as an independent business, now called Aimia, which has expanded its customer base and evolved its services over the years.